PBOC: China to promptly assess climate change impact on financial stability
China will assess the impact of climate change on financial stability. /CFP

China will assess the impact of climate change on financial stability. /CFP

China's central bank will promptly assess the impact of climate change on financial stability and monetary policy, said Yi Gang, governor of the People's Bank of China (PBOC) at a roundtable at the Boao Forum for Asia Annual Conference on Tuesday.

Yi said the PBOC will consider climate change in the financial sector stress test.

China has pledged to peak carbon emissions before 2030 and become carbon neutral by 2060. The PBOC earlier estimated that China will need to invest 2.2 trillion yuan ($337 billion) in carbon emission reduction every year before 2030 and an annual 3.9 trillion yuan worth of investment from 2030 to 2060.

Yi said the central bank will give incentives to financial institutions to support low carbon transitions and unveil new tools to boost financing for carbon emission reductions.

Financial institutions in China are currently required to disclose the green financial bonds issued in the inter-bank market and report on the use and direction of green credit.

"We will establish a mandatory information disclosure system step by step in the future, covering various financial institutions and financing entities, with uniform disclosure standards," said Yi.

Referring to international cooperation, Yi said a common classification standard on green finance will be formulated as soon as possible.

He said the PBOC is working with the European Union in building classification standards on green finance. Yi also proposed introducing a set of unified classification standards within this year for the reference of international investors and promoting the coordinated development of international green funds.

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